Trump trade lives, Bitcoin hits record, Tesla gets street-high target, Monday.com falls
Many have asked if I am taking time off after ending my career at BNN Bloomberg last week. While that would be nice, my husband is going away for a weeklong work trip. So my “time off” includes solo parenting for 5 days. And attempting to write the newsletter ahead of all that. Please forgive my typos. My editors are still learning to read.
Trump card: Futures are indicating a strong open this morning after the S&P 500 put in its best weekly showing all year. The Trump trade took the S&P 500, NASDAQ and Dow Jones to fresh records. Small caps could hit record high this week if momentum continues. While Canadian markets did hit all-time highs this week the magnitude of the rally has been blunted by lower oil, gold and copper prices. Gold is off nearly 5% from its all-time high and trading near a one-month low. This is probably a profit-taking move rather than a signal that uncertainty has suddenly vanished. Another loser this election, supposedly, has been traditional media. But I found it interesting that news organizations like News Corp (owner of WSJ), Gannet (owner of USA Today) and New York Times are all trading near all-time or multi-year highs. Today the bond market is closed for Remembrance/Veterans Day, but the stock market is open. This week features US CPI on Wednesday, PPI Thursday and retail sales Friday.
Moon: Bitcoin is hitting fresh records this morning trading above $82,000. Crypto investors are clearly still in party mode following Donald Trump’s decisive win and the election of several pro-crypto people. Shares of crypto-exposed companies are continuing to rally with everything from Coinbase to Microstrategy to Riot all building on their gains since the election. Last week, Blackrock’s bitcoin ETF took in more than $1 billion in a single day. That is the biggest single day of inflows since inception.
Case of the Monday.com: Shares of Monday.com are plunging 15% in the pre-market despite better than expected results and boosting its forecast. While the workplace software company beat earnings expectations by 35% on an adjusted basis, it swung to a loss in reality. The wider loss also came with the announcement that the Chief Revenue Officer would be stepping down. Sales this quarter grew more than 30% and the company is boosting its forecast for the current quarter and the full year. Still, the management change could be an excuse to sell given the more than 70% run up in shares this year and its triple-digit multiple.
It’s complicated: Oil prices are back below $70/bl while natural gas prices are ripping about 7% right now. The oil slump is driven by weak demand data out of China. Over the weekend we got a read of inflation in China which showed signs of softness. Consumer inflation rose less than expected and producer prices fell for the 25th consecutive month. Natural gas, on the other hand, is higher. I am not sure how sustainable the rally can be given ample supply and warmer weather.
Notable Calls: Tesla shares are up 7% in the pre-market after Dan Ives of Wedbush slapped a street-high price target of $400 on the stock. “We believe the Trump White House win will be a gamechanger for the autonomous and AI story for Tesla and Musk over the coming years,” he wrote in a note to clients. He says Tesla will hit $1.5 to $2 trillion in market value over the next 12-18 months. TD is upgrading shares of Onex. TD says Onex has monetized a bunch of assets which they then use to support buybacks. The analyst, Graham Ryding, also says fee-related earnings are improving and liked strong credit fundraising. In mining, TD is downgrading Osisko Gold Royalties after a 50% jump in shares. RBC’s Darko Mihelic is out with a Canadian bank earnings preview this morning. He says we could be in for a period of mortgage competition as rates fall but he is becoming increasingly more bullish on the stocks as earnings and credit quality look set to improve. Bank earnings start first week of December.
